NORWICH – NBT Bancorp Inc. reported net income and diluted earnings per share for the quarter and year ending December 31, 2022.

Net income for the year ended was $152.0 million, or $3.52 per diluted common share, compared to $154.9 million, or $3.54 per diluted share, in the prior year.

“Our operating results for the fourth quarter and full year of 2022 reflect strong execution by our team, including organic loan growth of over 10 percent and disciplined cost of funds management,” said NBT President and CEO John H. Watt, Jr.

“We recognized the benefits of an asset-sensitive balance sheet in 2022 with increases in the targeted Fed Funds rate, and our credit quality continues to be excellent with low levels of net charge-offs and nonperforming assets.

“In December, we entered into a definitive agreement to merge with Salisbury Bancorp, Inc. Aligned cultures and complementary markets support the strategic rationale for our partnership with this premier community bank franchise headquartered in Lakeville, CT. We expect the merger to close in the second quarter of 2023, pending required regulatory and shareholder approvals.

“We were pleased to reach the milestone of 10 consecutive years of annual dividend increases in 2022,” added Watt.

“The payment of a meaningful and growing dividend is an important component of our commitment to consistent and favorable long-term returns for our shareholders,” he said.

NBT Bank generated positive operating leverage of $21.7 million with total revenues increasing 8.1%, or $38.9 million, while operating expenses were higher by 6.0%, or $17.2 million.

Net interest income in 2022 improved in comparison to 2021, primarily due to higher yields on earning assets due to increases in the Federal Reserve’s targeted Federal Funds rate combined with growth in earning assets, strongly overcoming a $17.6 million ($0.31 per diluted share) year-over-year decrease in income from the Paycheck Protection Program (“PPP”).

The Company recorded a provision for loan losses of $17.1 million ($0.31 per diluted share) in 2022, compared to a net benefit of $8.3 million ($0.15 per diluted share) in 2021.

Card services income was lower than 2021 driven by the impact from the Company being subject to the statutory price cap provisions of the Durbin Amendment to the Dodd-Frank Act (“Durbin Amendment”) of approximately $8 million ($0.14 per diluted share).

Net income for the three months ended December 31, 2022 was $36.1 million, or $0.84 per diluted common share, compared to $37.3 million, or $0.86 per diluted share, in the fourth quarter of 2021.

Net interest income in the fourth quarter of 2022 improved in comparison to the fourth quarter of 2021 and the linked third quarter of 2022, primarily due to higher yields on earning assets due to increases in the Federal Funds rate, despite a $7.5 million ($0.13 per diluted share) decrease in income from the PPP.

The Company recorded a provision for loan losses of $7.7 million ($0.14 per diluted share) in the fourth quarter of 2022, compared to a provision for loan losses of $3.1 million ($0.06 per diluted share) in the fourth quarter of 2021.

Card services income was lower than the fourth quarter of 2021 driven by the impact from the Company being subject to the statutory price cap provisions of the Durbin Amendment of approximately $4 million ($0.07 per diluted share).

In the fourth quarter of 2022, the Company incurred merger expenses of $1.0 million ($0.02 per diluted share) related to the pending acquisition of Salisbury Bancorp, Inc.

– Informaiton from NBT